Lean manufacturing is a production methodology that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful -- and thus should be eliminated. By working from the perspective of the customer (i.e. the person who consumes a product or service), "value" is defined as any action or process that a customer would be willing to pay for. "Waste" is anything the customer would be unwilling to pay for.

Thus, in essence, lean manufacturing is centered around creating more value for the customer (and less waste) with less effort.

For those steeped in classical efficiency training, Lean manufacturing can easily be viewed as a continuation on the theme of efficiency based on optimizing the work flow; it is a present-day version of the recurring themes of Henry Ford, and refined by such pioneers as Fred Taylor, Edwards Deming, Taiichi Ohno. Lean manufacturing is often seen as a more refined version of earlier efficiency efforts (of the early pioneers), and it is very closely related to the highly-successful Toyoda Production System.

Lean manufacturing is focused on getting the right things to the right place at the right time in the right quantity to achieve perfect work flow, while minimizing waste -- but also at being flexible and able to change.

The four goals of Lean Manufacturing systems are to:

Improve quality: In order to stay competitive in today’s marketplace, a company must understand its customers' wants and needs and design processes to meet their expectations and requirements.

Eliminate waste: Waste is any activity that consumes time, resources, or space but does not add any value to the product or service.

Reduce time: Reducing the time it takes to finish an activity from start to finish is one of the most effective ways to eliminate waste and lower costs.

Reduce total costs: To minimize cost, a company must produce only to customer demand. Overproduction increases a company’s inventory costs due to storage needs.

In classic Lean Manufacturing methodology, there are seven types of waste which must be reduced or eliminated:

Overproduction (occurs when production should have stopped)

Waiting (periods of inactivity)

Transport (unnecessary movement of materials)

Extra Processing (rework and reprocessing)

Inventory (excess inventory not directly required for current orders)

Motion (extra steps taken by employees due to inefficient layout)

Defects (do not conform to specifications or expectations)